What will the streaming landscape look like in 2026? The era of the "ad-free viewer" is ending, and the "Affinity Economy" is just beginning. To map the future of Connected TV (CTV), Roku convened a powerhouse panel featuring Media Universe Cartographer Evan Shapiro, Horizon Futures EVP Michelle Donati, and Roku’s Platform Insights Director Jon Merkin. In this exclusive session, they analyze proprietary data to deliver five bold forecasts—ranging from the impact of AI-driven personalization to the collision of Hollywood and the Creator Economy. Watch the full video for the deep dive, or read the full 2026 Predictions Report for our comprehensive breakdown of the 5 trends that will define the next three years of media.
Full Transcript
Hi everyone, thank you so much for joining us today. Welcome to Roku’s Streaming in 2026 Predictions webinar. My name is Sarah Monahan, and I am the Co-Head of Enterprise Sales here at Roku.
I am fortunate enough to not only be your host today, but to also be joined by some very special guests. With me is my colleague, Jon Merkin, Director of Platform Insights and Analytics.
Evan Shapiro, Media Universe Cartographer, and Michelle Donati, Chief EVP of Horizon Futures.
Thanks so much to all of you for making time today for our crystal ball conversation into the future of streaming.
We are very excited to bring the audience five predictions that are mostly science, maybe a little bit art, but based on what Roku sees happening on our platform — the rich insights we’re able to glean from over 50% of streamers.
Everything that they’ve done behaviorally on and off platform over the past year, what we’ve seen our media and entertainment partners doing on our platform, off our platform — and with those insights, we’ve made five bold statements, some more bold than others.
And we’re going to take you through all of them today.
So how this will work is we will introduce each prediction. Jon Merkin will take us through the insights and the data that we used to inform the prediction, and then we will throw it to Evan and Michelle to resoundingly agree with us, thoughtfully disagree, etc., etc.
So with that, I think we’ll start with our first prediction.
Jon Merkin - 05:07
So, as, platforms continue to glean insights about their users from signals across their UX. We feel, I mean, a new wave of AI-driven personalization will shrink the time it takes viewers to find their next watch. Platforms will become more, more responsive to individual tastes, and recommend more relevant con- or more relevant content. We feel like this can't come soon enough. I'm sure we can all, relate to the experience of taking a long time, jumping in and out of apps, searching for what content to watch. YouTube and Netflix are well ahead of the curve here, each saying that about 70-80% of their viewership is impacted by wrecks that they make. The Netflix algo has expanded their effective catalog by 4X, which is pretty cool because users are able to find deep cuts, niche titles that suit what they're looking for. And OS's like ours will catch up this year on our platform. In particular, we've added a "Rec" content row to our home screen, which is already driving almost 10% of all streaming on our platform.
We also see an opportunity for free ad-supported services, like the broker channel, Tubi. These apps have no barrier to entry or exit, and they have an opportunity to boost loyalty and repeat users by combining AI tools with their first-party data. Recs across these apps will evolve, they'll feel seamless. Your platforms and apps will know you to a very strong
To a very strong degree. And there's also a lot of benefits to brands here. So these shifts mean that audiences are seeing more ads that resonate, which is great. Last year, almost three-quarters of our streamers said that they pay more attention to ads that reflect their interests. So to us, this is a win-win-win, where everyone is getting what they want sooner.
Sarah Monahan — 07:01
Okay, hot take out the gate. I think we'll start with Michelle. Anything in here that…
Feels at odds with what you hear from your brand partners, within the walls of your agency.
Michelle Donati — 07:16
No, this is actually, you know, one of our predictions as well, and we are aligned with Roku on this. You know, we're seeing consumers lean into AI for purchase, you know, for their purchase journey across a variety of different categories, but entertainment is by far the top category where they're really leaning into AI recommendations and AI summaries.
So, we can confirm this through a lot of the primary research that we've done. It's interesting, though, it provides… it brings, like, an interesting challenge for advertisers. If that time spent on the home screen, or that time spent deciding what to watch decreases, then it makes it even more important for brands to show up as creators, right, and in the content. And that's another big prediction that we have for 2026.
Sarah Monahan — 07:59
Yes, you're getting a little bit ahead of it, but I feel like anytime we say the word creators, or anyone says the word creators, Evan's ears just perk up.
Evan Shapiro — 08:08
We should drink every time someone says it.
Sarah Monahan — 08:11
Save that, but Evan, anything to add?
Evan Shapiro — 08:15
Yeah, there's a lot to this, and they're gonna wind together a bunch of your elements of your all five predictions here, but I think one of the predictions I'm making for next year is that the AI D2C bubble is gonna burst a bit.
But that AI, a prediction I made for this year, was actually going to be a very unsexy success. And one of the great examples of this is AI operating behind the scenes, not right overtly out there, but just creating greater discoverability, much more personalization, and in particular, going to solve some of the biggest problems
in the ecosystem. One, the average consumer, according to Comscore, takes 20 minutes.
to find something to watch on streaming, which is just mind-numbing. Very often, people just give up and watch Comfort Food, like Friends.
And they don't discover new, interesting programming for themselves. The other thing is the over-frequency and the misplacement of ads against the wrong consumer. That's very frustrating and creates a very unpleasant user experience. So I do think, and we'll talk about this a bit later, but the influence of so much money that's gonna infiltrate the advertising ecosystem, specifically on connected televisions.
From the midterms this year is gonna force a lot of the bubbles out of the pipeline.
and really create a much higher level of personalization on every single aspect of the entertainment continuum. So I wholeheart… I violently agree with this prediction.
Sarah Monahan — 09:47
Do we think the idea of personalization for brands is gonna make a lot of progress?
In 2026, from a creative perspective.
Evan Shapiro — 09:57
I would defer to Michelle on that a bit, but I will also weigh in.
Michelle Donati — 10:01
I mean, I think yes. I mean, if you look at all the tech that's available to us now, and the capabilities that we're already leaning into when it comes to customizing creative and messaging, you know, and AI just makes that easier and faster and smarter. So, you know, I think it's a lot more of a reality for advertisers in 2026, and I think if you think what's happening with culture, and the fragmentation of a lot of that with subcultures.
you know, really rising and kind of the end of a lot of that mainstream and that niche, like, people want really tailored experiences. So the more that brands and entertain, you know, entertainment options can really lean into that, the better.
Evan Shapiro — 10:38
Yeah, and that's… that improves things for the advertiser, but it also makes it more complicated. So, you know, yes, you're gonna get better targeting, you're gonna be able to build your audience better, and the personalization of the ads per individual audience member is going to improve, but on the other hand, it means you're gonna have to have more creative
for more buyer types. So you can't… you're not going to want to deliver the same ad to the 58-year-old
dude, like me, that you are to my 27-year-old daughter, or towards, you know, the 14-year-old
kid, if you are whatever brand you are. So you're going to want to have many more versions of creative so that the personalization can actually do what it's supposed to do. If you're serving the same ad to everybody, that kind of defeats the purpose of it.
Sarah Monahan — 11:22
Right, so easier, for streamers to find content. More complex for brands, but ultimately better for…
for all. Yeah. If you want to put the work into it.
Alright, we better move on to our second prediction.
perhaps the hottest take, but John Markin's gonna prove why, in fact, it's not.
Jon Merkin — 11:45
Yeah, so I would say, start by saying, gone are the days when CTV was a haven for those people who were seeking an ad-free viewing… viewing experience. Folks today on streaming, they tolerate ads, they're…
Happy to watch ads in exchange for free or low-cost content. According to Nielsen, nearly 8 in 10 streaming TV hours are now ad-supported, which is an all-time high, and 96% of Roku streaming households see video ads. Our prediction is that this is going to go to 100%.
As the ad-free streamer will go extinct in the next year. And now, to be clear, we're not saying that 100% of content will be ad-supported, but rather that everyone will see at least some ads.
This trend has been in motion for years. YouTube, the number one app on streaming, according to the gauge, is nearly all ad-supported. Prime Video converted all their streamers to be ad-supported, I think, early last year. Virtually all major SVODs
now have an ad tier. You see Hulu and Peacock also with a high share of their users, seeing ads. According to an antenna.
Ad-supported subs were up 33% year-on-year in Q2 of this year, much higher than the growth of subs on ad-free tiers. And even streamers who only watch ad-free tiers still see ads through watching live sports or news.
I also want to mention that free ad-supported apps like the Roku channel, powered by live linear fast viewing, are growing at an outsized rate. Fast viewing.
which is, again, is that live linear experience. We'll reach 10% of all Roku streaming in the next year, as roughly 2 in 3 Roku users watch TV this way. And many of those people that are now watching
free ad-supported content used to be ad-free. On our platform, roughly 60% of the households who used to watch only ad-free streaming back in 2020 are now watching fast.
Lastly, we also want to note that this trend brings with it a challenge on publishers and platforms to control the volume of ads, not pushing users to churn out. Consumers will accept the presence of ads to a certain point, and something that I think we all need to be aware of is that as ad free frequency ticks up, it can be easy for that to happen, and we don't want… and so we don't want that to happen. We want to keep a bit of an eye on it.
But consumers are definitely willing to watch a lot more ads than we've been giving… than we've been thinking, even a couple of years ago.
Sarah Monahan — 14:17
Evan, we'll start with you. As a consumer, is this surprising?
Evan Shapiro — 14:23
I mean, yeah, to a certain extent, I think it's counterintuitive to a lot of people's experiences, especially people who are in our industry. You know, those of us who are in the industry tend to… it's interesting, we're in the advertising business, and then we go home and we subscribe to the ad-free version of every single service that we do. But we also have to realize that's a rich person's experience.
We really have to understand that we are not the audience. So, most consumers, 80 plus percent, probably even higher than that, are not willing to pay what is now required to subscribe to all these different services.
The second part of that is, if you take the first prediction and the personalization gets much better, the over-frequency comes down, the targeting gets better, the matching of audience to messaging gets even better, and to John's point, we don't clutter up the experience, it's gonna be less…
unpleasant. It's gonna be more pleasant, to watch the ad-based platforms. The other thing that's gonna happen is the ad-free business model is not profitable.
It is, you know, Netflix made it work for a while. Congratulations. That time is over, obviously, as they make deals with the NFL. They're trying to buy Warner Bros. Discovery, they make deals with wrestling, like, they have… they're turning into an advertising-based business. The deal they made with TF1 in France.
And so they're admitting that business model does not work. The ARPU of an ad-free viewer is just not enough.
to sustain the level of programming necessary to keep subscribers subscribed. And so what's gonna happen is the ad-free tiers are gonna go up and up, and up in price, so that they can actually be break-even or better, and they're gonna drive more and more consumers
to the ad-supported tiers. And then there's the other thing, which is even if you are an ad-free addict.
you want to be in ad-free experiences, it's going to be impossible to turn on your television
7 days a week, and not see some ads. If you watch sports, you're gonna see ads. If you watch news, you're gonna see ads. When you turn on your home screen, whether it's on Roku or one of the other OEMs out there, that
home screen is gonna have an ad on it almost all of the time. One, it's really valuable real estate, and two, that's how you reach the ad-free viewer. So, I agree with this. At first, when I first saw this prediction, I'm like, that sounds like bullshit.
Sorry, that sounds like malarkey. But I also…
then kind of did the math, and I'm like, oh no, I see ads every day.
And so, I think it's gonna be impossible to be a regular television viewer, somebody who turns on the television once or more times a day and not see ads. Certainly, I think that's true now, so I think it's going to be doubly true by the end of the year.
Sarah Monahan — 17:16
Michelle, curious, is this… are you still talking to your brands in language like, the S-Bot only
customer versus Avon Heavy, you know, is it… have you moved past that, and you're talking in different language, or is it still sort of parsing out the streamer?
In terms of… Their aptitude for ads.
Michele Donati — 17:39
I think, like Evan said, you know, this headline, when I first saw it, gave me a little bit of a knee-jerk reaction as well, because I am, just like Evan was describing, as an industry professional, do everything I can to avoid the ads, and I'm still captivated by the home screen. From a planning perspective, you know, when we gather research, we try to, you know, we like to put people into boxes, right, into categories, like you just described, and that's becoming increasingly difficult.
Because the experiences are evolving, the way people engage with them, you know, all this fragmentation we've seen, which is amazing, you know, there's content for everyone, seemingly, being produced for everyone, then you're seeing bundling, right? Like, Evan was talking about, like, these models aren't sustainable, so you're seeing more and more bundling of streaming services, so, like, the people who, you know, go to aggregators versus the folks who are, you know, going straight to the streaming provider themselves to
versus the ones who are getting through cable, like.
those different… that differentiation is going… is increasingly going away. That's what we're seeing. So it makes it… it makes it a good thing, but also, you know, when it comes to planning, you know, trying to reach that consumer across all those different types of streaming relationships is a lot easier, but the blinds are… are blurry, right? So…
That also provides some complexity.
Sarah Monahan — 18:53
Sure, and I imagine this also introduces the
increasingly interesting conversation around Fast, and the role it'll play in the media mix, the role it plays in consumers' lives. I feel like we've spent, John, I feel like a good deal of most meetings this past year educating a lot of our brand partners on, as we see
The increased time spent within the room.
Evan Shapiro — 19:17
When you look at… when you look at the current viewing environment, if you just use Nielsen's data, grain of salt, then you can see, my extrapolation shows that Fast and Netflix are basically on par. If you take the whole Fast ecosystem, those two are tied right now. And Netflix's viewership has been flat.
in almost every territory that I've been looking at, over the last 3 years, despite subscription increases. So, you know, Tubi, Roku, the rest, they're growing, you know, pretty fast, pardon the pun, at year after year after year. So, I think John's prediction of 10% by end of 2026 is actually conservative. I think it'll be much higher, the whole of Fast will be much bigger
than Netflix by year's end.
Michele Donati — 20:03
Yeah, I mean, at Horizon, we work with a lot of the entertainment, you know, companies and content providers, so we see, you know, they're putting this premium content into these environments, so why wouldn't… I mean, as a consumer, like, why wouldn't you watch this, right? It's free, the ad breaks are shorter than they are in traditional linear, you know, you're getting all the content that you want, there's a lot of that comfort food that Evan mentioned before, so I agree, I think even the 10% might be conservative.
But… and it makes, you know, from a measurement perspective, it also makes things challenging, too. You know, we think about what is our currency when it comes to video planning and negotiation. You know, there's that complexity as well for us to navigate, so…
Hopefully in 2026, it'll be… More or less complex. We'll see less complexity.
Sarah Monahan — 20:46
It's been a prediction.
Evan Shapiro — 20:48
Wishful thinking.
Well, that's… that's a wish we got… we make every year, isn't it?
One other thing I would add is that during 2026, YouTube is going to introduce dynamic
branded insertion in videos on YouTube. So it's… this is not the programmatic AdSense ad fill, this is branded spots that creators do directly with brands that YouTube doesn't actually traditionally take a piece of.
That's been the fastest growing segment of YouTube's ad economy this year. I think when that dynamic insertion comes next year, it's gonna…
really explode, and then that's a branded piece in the video. I don't think you're gonna ever be able to avoid that.
Sarah Monahan — 21:32
Okay, I'm getting the… Time to move on.
Michele Donati — 21:36
This was a juicy one.
Sarah Monahan — 21:37
I know, I like this one.
Evan Shapiro — 21:38
Yeah, controversy adds, content.
Sarah Monahan — 21:41
On to the next. CTV offers a safe space as AI eats the internet.
Jon Merkin — 21:46
Hopefully less controversy with this one. But, so, yeah, I would kind of tease that by saying that while LLMs are obviously changing the world in many ways, one negative impact they're having, as far as brands go, is on social and search. AI-generated content, summaries, slop, social posts.
lead to less usage and less trust. The rise of zero-click searches means less ad volume, less visibility on publisher content, and less data about what users are doing.
And Gen AI has flooded social media with offensive content, content you can't trust, raising questions about brand safety. Even the smartest among us, I would imagine even Evan, maybe once, has been fooled by AI content, and that's not a great place for brands to be. Whereas CTV is
Largely safe from the most disruptive effects of gen… gen AI. It gives a safe and high-intentioned
environment, along with a strong ability to measure outcomes. Ads on platforms like ours command greater retention than they do on other, on other places, and brands are taking… brands are taking notice.
Excuse me. Not to mention, we feel that as the AI craze goes on, as slop continues to proliferate, audiences will crave high-quality, TV-caliber content more than they ever have. In this next year, we believe that up to 50%, up to half of all streaming brands.
We'll subsidize their spend on platforms like ours, with budgets siphoned from social and search.
Pressures on both of those channels.
will lead many advertisers to hedge their bets and ramp up spend on CCTV. I think a stat that has come out already from the IAB, saying that about 36% of advertisers who plan to spend more on CTV will shift those dollars from social. 32% say they will shift those dollars from paid search. So we think this trend, obviously, has been going on for a little bit and will only continue to accelerate.
In the new year.
Sarah Monahan — 23:50
Well, as the sales leader at Roku, I love this prediction, but I'm curious. Michelle, we'll start with you. Fact, fiction, what are your thoughts?
Michele Donati — 24:01
I mean, we've seen… we've already seen the migration towards CTV, you know, that's something that's been happening over the past several years with the majority of our brands.
And I think everything that John talked about with, like, the AI slop that we're seeing on the internet, is only going to accelerate that more. There's this interesting kind of juxtaposition between… that we see in our consumer research about how people… consumers really love the ease and the efficiency that AI provides them, but when they're presented with, you know, content that's 100%, you know, AI-generated, no human in the loop.
they feel a bit disrespected, you know? They shun it, you know? So I think that, you know, CTV is a place where
you know, creators and entertainment companies can really use AI to enhance their content, to personalize the content, you know, to make it more relevant, without kind of disrespecting, you know, the viewing experience for the consumer, and still creating a very quality environment that makes the brands feel safe.
Evan Shapiro — 24:59
I'm gonna take a bit of a contradictory take on this. You know.
I think that the idea that people are going to leave social media because of AI slop is absolutely incorrect. You know, when you look at time spent for people under the age of 45, so millennials… 70% of the world's population are millennials and younger.
70% of the world's population are millennials and younger. That's kind of math that I think people don't understand.
And so, television is not the first experience that people who are millennials and younger, and certainly Gen Z and Gen A, they're not heading to the television set as the primary device for their entertainment. They're going… and by the way, who here has a smartphone?
Raise your hand.
Who hears their smartphone the first thing they touch in the morning? Raise your hand.
Who hears this… be honest.
Who is near their… the smartphone the last thing they touch at night?
Sarah Monahan — 25:54
Ugh.
Evan Shapiro — 25:55
Yeah, I'm sorry if you…
Michele Donati — 25:56
Try not to, but yeah.
Evan Shapiro — 25:58
Sorry for your significant others. 2026 goals. Yeah, but…
But, like, so the phone and social media is our first checkout. It is the remote control that drives the rest of our lives, so I do think we're not gonna see a huge migration from social media to connected television, and wherever the audience goes, that's where the advertisers are gonna go.
So, that's crucial to understand. But, I think on social media, to avoid ASLOP, there's gonna be a lot more branded integration with big brands.
Brands as creators, meaning publishers as creators, and then also creators themselves.
Now, on the other hand, I think search is toast.
I haven't used actual search in a long time. I use Gemini on Google. It's exclusively how I do my search, which is crushing a lot of traffic for, for websites and apps out there, and that's a real danger. And so when paid search becomes substantially less effective, yes, I think those dollars are gonna look
For a place to go.
The other component to this, and I think this is the huge advantage of CTV, is retail media is looking for off-platform, top-of-funnel experiences. That's new money.
That is… that is money that has never been on television before. Small and mid-sized businesses who have never advertised before are suddenly able, using AI, using deterministic data, to get on connected television. So I do think connected television will see… connected television is going to be the one part of TV that goes up in 2026. The rest is either going to be flat or down.
And the reason is not necessarily escaping AI slop, but because it's more targeted, it's more personalized. Small businesses can now do small buys.
And retail media in particular is gonna be looking for top of funnel, full funnel experiences, and we've been saying full funnel for years. It's been a little kind of shell game. Now, I actually think we're in an area where the full funnel is gonna be on television, on connected television.
Sarah Monahan — 28:06
Do we agree?
Up and to the right.
Where the budgets will come from.
TBD. We'll meet back here in a year. Yeah.
Evan Shapiro — 28:17
I don't think people are gonna move money from social to connected television. I think new money is gonna find its way onto connected television.
Sarah Monahan — 28:23
Where do you think the paid search dollars will be?
Evan Shapiro — 28:26
That's… that's new money, though. That… so that's new… that's… but that's not social media, that's paid search. So there's… those are two things.
Michele Donati — 28:34
And, like, a Google is not gonna let all those search dollars go. I mean, introducing ad experiences within Gemini, you know, very shortly, so…
Sarah Monahan — 28:41
with the family.
Michele Donati — 28:42
It'll be very interesting to see how it plays out, the fight for the dollars. The retail aspect is really interesting, Evan. That's a really great point, because I think we've talked about shoppable for years, but it's never really… the execution of it in a CTV space hasn't really delivered on the promise.
Evan Shapiro — 28:57
I do think you'll start to see more, better, shoppable experiences, but also, the retail media buyers, and I've surveyed them personally, they're worried about having basically abandoned the top of funnel.
they're really worried about having abandoned brand, because it's hard to sell a product nobody knows about. And so I do think that they're gonna look for better, kind of, dynamic sight motion and sound, for, you know, and that's television. And connected television gives you the data married to that.
Sarah Monahan — 29:30
Yes, I wholeheartedly agree with that. I think the last 18 months has been education and getting a lot of people, including the suppliers on the other end of the retail media.
Evan Shapiro — 29:41
story, really comfortable with this medium playing a different role? Well, and your deal with Amazon has been very, very important for you, and not to mention a competitor. Actually, I do mean to mention them. There's a reason why Walmart barred Vizio.
It's not an accident. It's the second largest retail media, platform in the United States.
Sarah Monahan — 30:03
The future is full funnel, no doubt. Okay, moving on to number… 4…
Jon Merkin — 30:10
Yeah, I would say actually that whole… those points that Michelle and Evan brought up both dovetail nicely with the next couple of predictions, so thank you. So I don't think anyone on the panel has a very strong thought on creators.
Sarah Monahan — 30:20
And I think we should just move on.
Jon Merkin — 30:21
This'll be a quick…
Evan Shapiro — 30:23
Like, nothing the same.
Jon Merkin — 30:23
So tens of millions of people are making their, are making their,
Livelihoods, businesses being creators.
making and monetizing content today for most of the planet. While many of those folks got their start on social media, they were buoyed by YouTube, which also benefited great, greatly. 2026 will be the year that creator content makes a splash on CTV through ads, licensing, and more. And at least one major
service beyond YouTube will add a Creator tab to make it easier for users to find that type of content.
This is not necessarily a super new trend. Creators have been expanding to Tubi, Samsung TV, and Roku Channel is no exception. A couple years ago, we partnered with
a company called JellySmack to launch fast channels with popular creators, which attracted new audiences and expanded our content. These bets have been paying off,
In August, we found that viewership of creator-led content on the Roku channel grew nearly 80% in terms of streaming hours per household year on year. So those that are finding the content are really getting very… are really getting very into it. It's becoming some of their go… some of their go-to content. In 2026, popular creators will extend their existing e-commerce and sponsorship
activities through, through ads across platforms like, like, like.
hours, Imagine Roku City with MrBeast. They'll be able to engage their fan bases on the largest screen in the home, giving creators a whole new audience, and boosting shoppable activations. Michelle, to your point, in the process. We feel that creators may be just
the vehicle needed to make Shoppable really take shape in the next year.
Evan Shapiro — 32:14
Okay. You want me to jump in there?
Sarah Monahan — 32:15
I think we'll start with Evan on this one, Michelle, and then we'll kick it to you.
Evan Shapiro — 32:19
Yeah, I think it's really important to note that I think that there's this myth, or this misperception, or this bias amongst a lot of us Xers and our elders boomers, you know, thinking creators or influencers just doing makeup tutorials. You know, as a creator myself, I can tell you, it's a friggin' job.
And these are professional…
producers. MrBeast made the most expensive game show in the history of television for Amazon and just got picked up for two more seasons. Jake Paul slapped the heck out of an old man on a boxing ring and got paid $40 million and broke Netflix in the process. You guys launched a bunch of
creator channels, channels. Full 24 hours, 7 days a week channels, and they're doing quite well for you, as John just mentioned.
And then you've got Netflix, who says YouTube is for wasting time, and then signs Ms. Rachel, and Sidemen, and Jake Paul, and Kill Tony. There are a billion people
who watch…
podcasts on TV. When you watch a podcast on TV, that's called a talk show, but those are creators. And so, that part of creators being
inserted into the traditional television ecosystem is one reason why this prediction is not just right, it's right on steroids. The second part of this is what Michelle just said earlier, which is
Brands are going to become creators. Big studios are already becoming creators. BBC Studios and Bluey, massive YouTube presence, while it's also the number one streaming
Show in the world.
ITV is taking Love Island to every creator platform that you can possibly think of. And so, what I… my big prediction for 2026 is that the affinity economy, and this is my own self-serving plug, the affinity economy, which I coined, is gonna become a thing. And what that is, is the marriage, or the melding.
or the mixture of traditional media and the creator economy into one ecosystem, where brands are creators and creators are studios, and the twains are gonna mix every day, all the time, all year long. So I definitely think this is not just right, it's already right, and it's gonna get righter every day.
Sarah Monahan — 34:37
And Michelle, how are…
your brands leaning into this. I know lots of your brands are media and entertainment companies, but what about the more traditional brands? Are they excited to invest here? Are they already investing?
Michele Donati — 34:49
You know, I think there was trepidation originally because of some of the things that have been talked about, like the perception that creators are just doing, you know, get ready with me makeup tutorials, and it's, you know, that the content isn't really premium, and it's not brand safe.
You know, it's not a place where you can have control, but we have an entire division called Blue Hour Studios who helps our brands navigate this, you know, and it's growing. It's growing a lot, and…
Evan was saying before, you know, there are signals, too, in the industry of, like, you know, the guy who won the Timothee Chalamet look-alike contest has now started a creator studio, and then you see, you know, the creators moving… acting more like, you know, traditional entertainment studios. So, we're definitely seeing the convergence. I think.
Having a good framework in place for brands to select the right creators to work with, you know, to provide the right briefs and the right guidelines for their brands to the creators, and really have more of an open dialogue and a collaboration to work more closely with them is what helps them be successful in this space.
But, you know, if you're not there, you should be. I mean, that's pretty much what we're telling brands these days, is that, how do you avoid it? You know, these are some of the most influential voices in our everyday lives.
You know, we have our phones, like Evan said, first thing in the morning, first thing at the end of the day. A lot of times we're engaging with our favorite creators who, you know, are providing us guidance and advice on all different types of decisions in our lives, whether they know it or not.
So it's an important space. I think it's really exciting to see this convergence.
Evan Shapiro — 36:14
And I also think it's really important to understand that superstars from traditional media are also becoming creators. So the smart list guys, Dax Shepard, you're seeing all of these trad stars turning into creators because they get more control, they own the IP,
And they don't have to wait around to be greenlit. They can go directly to their own consumers and their own audience and monetize it in a consistent way that isn't so reliant on the gatekeepers, frankly.
Sarah Monahan — 36:45
And do you guys think over time, as consumers, as streamers, audiences will no longer be able to distinguish?
this was… this came from a traditional media company, this is creator content. Like, we as a platform are starting to, in our destinations, you know, put like content together, and it's creator content from foodies, you know, next to this old house, and…
the Food Network content. So, from our perspective, it's all about the contextual alignment. Are consumers there yet, or can they… are they still looking at it as two distinctly different things?
Evan Shapiro — 37:22
I think the line gets less important every day, especially when you see Jake Paul on not only Netflix, but HBO, and Ms. Rachel on Netflix, and MrBeast on Amazon, but you can go much further than that. You know, the fastest growing audience for YouTube on television is people over 55.
So, this is now just the norm, and I think the distinction is made, and it's funny, so YouTube just picked up the Oscars for starting in 2029. They just announced that today. And just before I came on here, I predicted something like that a year ago.
And so I went and took a victory lap around LinkedIn, where I post things about YouTube being television, and people put in… they put in the comments section, and you can actually hear it this way, YouTube is not TV!
Well, now that they have the Oscars, is YouTube TV? Could you admit that now? Could you possibly admit that now? The only people who refuse to make this admission are
are Xers and boomers in our industry. Those are the only ones who hold white-knuckled onto these things, because it means that they have to learn new skill sets. But, you know, when Mr… when Dude Perfect gets a $100 million investment for their studio.
and Alex Cooper gets $125 million for her podcast, let's stop making that differentiation.
Sarah Monahan — 38:48
YouTube and the Oscars. We want you to make the 2026
big, provocative prediction here, after we round out ours with the fifth and final prediction.
Evan Shapiro — 38:59
Okay.
Sarah Monahan — 39:00
Yeah, we're gonna bring it home with a sexy topic of local advertising. I liked how your voice actually got appropriate for local advertising, John.
Jon Merkin — 39:11
Well, I've done voice work before. Anyway, no, I'm kidding. So, local ads, which have been a mainstay of TV for a long time, has actually largely been absent from
the streaming world. We think they have a large role to play in this coming year, driven by the midterm election cycle that's coming up. Streaming has the scale to help regional brands find hyper-local audiences.
in a way that affiliate stations in linear TV have done for a while. We're able at Roku to target down to the zip code with the tools to optimize, prove out that people are seeing the ads and the ads are being, you know, effective reaching the right folks.
Political campaigns will demonstrate that self-serve TV ads combined with AI-generated creative can help candidates turn out the vote. And seeing this, all sorts of local businesses will come onto our ads manager tool and follow suit.
Local ad dollars are flowing into CTV already, reaching an estimated $2.8 billion this year, so about 8% of all local video ads already on CTV, and we feel like that's going to go up. Gen AI is being used to quickly build and launch creative, customized market by market for regional and national brands that operate local franchises. It'll become easier to test dozens or even hundreds of adverts
In the markets where they… in the markets where they are.
We predict that, assuming that Evan brought up a couple of points ago, that CTV will be the only channel
in which political spending next year will outpace 2024. So a midterm election year, you'll see more CTV spend than you saw in a general year, which is pretty nuts. More voters have cut the cord. We find now that one in three potential voters only uses CTV to watch their news, as opposed to broadcast or cable. So this is the place to find them. So we think it's going to be a big year for hyperlocal
Targeting both in the political realm and beyond.
Sarah Monahan — 41:11
Michelle, is this something you at Horizon are preparing your brands for?
Michele Donati — 41:16
Absolutely. I mean, we represent a lot of retail-based, you know, franchise-based, we have automotive dealer associations, we've got cable companies.
you know, we have, QSR businesses, and…
Those are the ones who, especially, you know, when they're tailoring offers by market, you know, and kind of right-sizing their spend by market, they've already leaned into this space because it makes it a lot easier for them to control, you know, who they're reaching, how many times they're reaching them, just like, you know, a la, like you said, the political campaigns.
That John mentioned before. So, they've definitely adopted this strategy. It's, it's…
typically, you know, in some cases, it's actually they're outspending, you know, their linear spend with the CTV spend in local markets because of the targetability and, you know, the able to dynamically insert and all those other capabilities that are offered to them. So it's definitely a trend that we're seeing, and we…
expected to continue. I'm not surprised to see that, you know, 2026 would outpace 2024. Honestly, based on all the consumer pulse work that we do and the sentiment that's out there, you know, I think, it's gonna be a pretty heated… heated marketplace that we're… we're trying to prepare for now.
As best we can.
Sarah Monahan — 42:31
Evan, anything to add?
Evan Shapiro — 42:32
Yeah, I think, you know, what's interesting is just how much money…
this is a midterm, this isn't even a presidential election. So, I think that what happens is when you see this much money flood through, and these are all local elections, none of these are national elections, right? So… and yeah, there are Senate seats which are statewide, but most of these are district
level, you know, neighborhood, you know, council-level, judge-level, elections, and so I think you're gonna see the, the, when this much money goes through the system, and, and gets pumped through, and it's almost all gonna be between June and November.
So it's also a compressed timeframe as well. So that's gonna change the shape of television advertising, and I think positively. I'm not a huge fan of money in politics. I think it's very…
detrimental to democracy. So let's put that aside. This is not that discussion. But on the other hand, I think the positive effect here will be this will pop all the bubbles in the pipeline. This will create new flows to the head end, and really, really create major opportunities for small and mid-sized businesses
and the people who sell to them on the other side. So I think by this time next year, we'll be talking about a substantially different-looking
connected television ecosystem, which means the ability for individual consumers to place ads on TV, but on the flip side, also the effectiveness and personalization and reporting and transparency. I think we'll have a much better ecosystem because of all of this money. This is like the roto-Rooter to a lot of the issues that creator, that CTV has been having in its pipes over the last number of years.
there's a positive aspect for the industry for this, and I completely agree. And the hyper… I think local… I think the other thing to note from this is the amount of opportunity this creates for local content.
I think there's this misperception that Millennials, Gen Zers, Gen A-ers don't…
blunt news. That's absolutely incorrect. They love news. They just want it through different sources. And so the idea that hyper-local on Fast, on YouTube, on, you know, other platforms, on television.
is going to become increasingly important, not just about politics, but what I'm doing this weekend, things to do with my family. Hyper, hyper, hyper local. There's this thing I like to talk about around food culture, which is, used to be you couldn't go to a small town in middle America and get a good meal.
Right? You had to go to McDonald's. But now, every town, you hear, like, oh, it's a foodie town now. And that's because Gen Zers aren't… when they want to become chefs and open restaurants, they're not going to the big city, they're staying home and opening it there.
Local culture is gonna be more important this time next year than it is today, and it's gonna get more important every year for the rest of this decade. So, not just around advertising, but if you're a content maker, think
act locally, and think locally. I think there's a major opportunity there.
Sarah Monahan — 45:41
That's really interesting.
Michele Donati — 45:43
we have a macro trend in our library called Local Love, and we're seeing the same thing. It's like, with all the divisiveness that we see, you know, in people's digital lives, and the pushing apart, that people are kind of…
gravitating towards these very localized IRL experiences, you know, they want to touch grass together.
Evan Shapiro — 45:59
grass, right.
Michele Donati — 46:00
Yeah, they want to… especially the Gen Z, you know, walk around a bookstore these days, you'll see a lot of teenagers, it's… it's pretty amazing.
Evan Shapiro — 46:08
We're not gonna really understand the effects of COVID for 25 years, but you're gonna start to see it play out, which is putting down the glass and going out and touching grass. That's gonna be a major movement for the rest of the decade.
Sarah Monahan — 46:21
A mother of three. That is a hopeful and pretty incredible statement.
Evan Shapiro — 46:26
Well, Australia just banned social media in schools, so…
Sarah Monahan — 46:29
Oh, I saw. God bless.
Okay, let's get a couple… you guys made a couple predictions throughout, but if there's any net new predictions that you want to make, we… I don't know if we're recording this, but I'm recording it.
Evan Shapiro — 46:44
You are recording.
Sarah Monahan — 46:44
And in one year.
We'll do our victory lap.
Evan Shapiro — 46:50
Michelle, do you want to go first, or do you want me to go first?
Michele Donati — 46:52
No, I mean, I'll go first. You know, we touched upon some of them, you know, we talked about brands as content,
again, the whole, like, conflict we see with AI, people leaning into it, but then also shunning it. Like, you know, I think that one of the things we're talking about is, you know, looking at
not AI-generated content as a premium, as, like, a luxury.
and people leaning into that, you think of, like, years and years ago when you look at manufacturing and people were hand-making goods, you know, and then we moved to kind of, like, mass production and things like that. So this, like, there's going to be, like, this artisan, if you will, artisan-crafted content that is not generated by AI, or has minimal use of AI that we think people are going to really lean into. So I think that's, like, a really interesting,
thing that we're predicting for 2026. And then I think also just, you know, again, the,
the shifts that we talked about, you know, in consumption. We're seeing, you know… Evan, you mentioned it before, about, like, the fastest growing segment over 55. We were predicting… we're predicting, like, this digital migration of the over 50 crowd, where, you know, their time spent online is going to be equal to or greater than what, you know, they're spending with traditional media, and I think that's… it's been a long time coming, as someone who's
Nearing that demographic.
You know, so that's another prediction that we have. So this digital migration of older… older adults.
how do we really define older? I know, I know, it's ridiculous. These marketing demographics have got to go.
Evan Shapiro — 48:22
I'm the only person on this Zoom who is in that demographic, so…
Michele Donati — 48:27
I mean, I have a 78-year-old uncle who lives, like, his entire life online, you know? He's cut the cord, like, doesn't have traditional cable, he's doing everything through… he's a big WhatsApp user, you know, he's Snapchatting, so I think the perception, this perception of this traditional media-dominant Gen Xer and boomer is gone. The numbers just haven't caught up, you know, the data hasn't caught up to
I think we're gonna see that next year.
Evan Shapiro — 48:56
So, I think, I'll go… and mine kind of is a chain of predictions that all are connected, but really quickly, millennials are turning 46 next year.
In 9 years, they'll be 55.
So, I think the demographics are kind of almost irrelevant. You really have to pay attention to the behavior dynamics of generational trajectories. So, as millennials turn 46, as all of 18 to 49 are Zs and Millennials.
Right? And most of 2554 are Gen Z and Millennials. You have to readjust everything you think about demographics in the United States, and around the planet.
But my major prediction is that the affinity economy becomes a thing, and that our… the way we measure success is gonna change dramatically. It's gonna gear much more towards outcomes and much less towards reach.
Much more towards engagement, and much less around CPMs. It's gonna be a cost of action as opposed to a cost of impression. And that, you know, bot traffic
follower counts, monthly average users, we're going to start to throw that out and start to really much more pay attention to the quality of engagement and the velocity of fandom. How quickly can I turn someone from a viewer into a buyer? How quickly can I take someone from a subscriber to a t-shirt wearer? So, the follow-on of that is.
As you were saying, brands becoming creators, acting
like creators, following the rules of the creator economy. Studios, and in particular, I believe 2026, so when Disney got into premium streaming in 2019, they single-handedly changed the industry overnight.
They got 10 million new subscribers in 30 days, and then everybody, you know, stampeded after them. They threw away their business models and forgot to add advertising to it, and now they're correcting all that, but they changed everything. So I think 2026 is the year that Disney finally
finally gets into the creator economy. Up until now, if you look at Disney's, social media platforms, YouTube, Instagram, Facebook, etc, it's almost all brochureware. It's almost all marketing, advertising, clips, trailers, and it's almost all paid and not organic.
I think this is the year that that changes, and that they're gonna really embrace direct YouTube originals, putting their library up on YouTube, putting their library up on TikTok.
putting everything that they have out there and making money off of it for the first time in a way that they haven't up until now. And that means understanding how to sell it as a package. And when they do that.
Everybody else, like the sheep they are, are gonna follow behind them, and it's gonna turn into a brand new ecosystem. It's not gonna… five years from now, the creator economy will not look like it does today. It's gonna be much more populated by big brands and big studios. As a consequence of that, I think there's a couple of follow-on effects. One, these midterms that we just talked about, I think you're gonna see the rise of the social media politician superstar.
We have one as president. No matter what you think of him, the reason he's president of the United States is because he's good at social media. That's it.
the new mayor that's coming in in New York.
No matter what you think of him, the reason he's going to be mayor next year is because he's spectacular at TikTok and Instagram. He's just best in class at it. His message really resonated with young people. How did he do that?
TikTok, and Instagram. He had more young voters as a percentage than any mayor in our history, and any politician in a long time.
And then lastly, something that's a little self-serving, I think if podcasting was, like, the thing of the last couple of years, I think you're gonna see Substack
be that thing on a moving forward basis. Barry Weiss, again, regardless of what you think of her, she's now the head of CBS News.
Whatever you think of that, it's absolutely true, it's a thing. And the reason she did that is because she left the New York Times, started a substack, built a very large audience there, sold it for $150 million to the Nepo Ellisons, and is now in charge of the CBS News, one of the largest news organizations in the world, and might be in charge of CNN soon, who knows?
So I think you're gonna see the rise of the Substack star the way we've seen the rise of the YouTuber and the rise of the, the rise of the podcaster. But this all rolls under this thing of this new content economy, which is creator economy and mainstream economy, basically Frankensteining into one monster.
Sarah Monahan — 53:40
It all makes sense.
Are there any questions for the audience? We have a few. Thank you both, by the way. Let's see, we'll start with one from Ted. Will top creators see CTV as a less cluttered by AI space versus YouTube and TikTok? Kind of like we're seeing with podcasts.
Evan Shapiro — 54:04
A question for anyone.
I think they already do… I mean, what's interesting, when you talk to a creator, they love their audiences, and, you know, they love what they do.
But they all have this desire to be on a big movie screen or a big television screen.
It still sits in the back of their minds, which is why they're doing it. So, yeah, I think it's… it's just… it's stepping… I think a lot of them see it, and I don't see it this way, because I think
when Jimmy Kimmel got forced off television, I think he should have gone directly to YouTube. And you look at Conan O'Brien and Tucker Carlson, Piers Morgan, and a bunch of people who got, you know, taken off of television or left television, they're much bigger, and they're making more money now that they're going direct to the consumer, so… But, I do think
it's step… it's not even so much… I think it's the clutter, less the AI. It's… it's really hard to compete on YouTube. It's just… because you're competing against every human.
And television isn't that way, so I do think they see it as a less cluttered, less messy place to do their business.
Jon Merkin — 55:04
There's probably also some element of, like, the grass is greener, right? Those folks that have been on TV for a long time, they want…
Sarah Monahan — 55:10
Well, control.
Jon Merkin — 55:10
or they want to do it by PL.
Evan Shapiro — 55:11
But you like me, you really, really like.
Jon Merkin — 55:13
Right, whereas if you think of, you know, you think, oh, I'm great on YouTube, but I'm just a little thumbnail, how cool to be on the biggest screen in the house? That seems very appealing. So I think it's also, there's pros and cons, obviously, to both, so I… it would make sense why, whatever you have, you know, how, like, athletes want to be rock stars, rock stars want to be athletes, kind of a similar…
Evan Shapiro — 55:30
Yeah, and it's also the mom problem. Like, what do I tell my mom I do? Oh, I'm a YouTuber. Really? You're a YouTuber couldn't get on television? And, you know, so… so, like, I think that's part of it as well. It's like, it's the validation aspect.
Michele Donati — 55:42
legitimizes the… Yeah.
Sarah Monahan — 55:46
Sure. Well, this has been amazing. We will wrap it up, but I appreciate both of you so much. John, thank you, as always.
Jon Merkin — 55:56
For representing the data insights aspect of the conversation. Shout out to the whole team, Nicole.
Sarah Monahan — 56:02
murdered it.
Jon Merkin — 56:03
Thank you for all the work you guys did for this, thank you.
Sarah Monahan — 56:05
Hope you'll join us again for the 2027 version of this while we're…
Evan Shapiro — 56:09
We'll go back and grade our… Grate ourselves.
Sarah Monahan — 56:12
But thank you all for joining, and have a happy holiday.
Evan Shapiro — 56:16
Thanks so much. Happy New Year.
Michele Donati — 56:17
Boom!
Jon Merkin — 56:18
Thanks, everybody, bye.
Sarah Monahan — 56:18
Bye, everybody.